I have talked about O3B networks a few times in my presentations and keynotes, and it looks like they are indeed moving forward: "O3b is building a next-generation network that combines the reach of satellite with the speed of fiber. Our groundbreaking services will enable emerging market telcos and ISPs to make the internet a truly global and universal experience. With world-class financial and operational support from SES, HSBC, Liberty Global, Development Bank of South Africa, Sofina, Satya Capital, Google, Northbridge Venture Partners, Allen & Company, O3b is creating a global internet backbone to serve several billions of consumers, businesses and other organisations in more than 150 countries...." If anyone has more information I'd love to hear about it. Nice video illustration, below.
It seems like every single day I read about how Internet and mobile companies are struggling to obtain the rights for what they want to do, whether it's about music, videos, TV shows, films, articles, text and images.
Netflix seems to have been more successful at tackling this wicked problem of content licensing, at least to some degree, by - as cnet aptly puts it - 'building relationships in traditional means' (I guess this means playing nice with Hollywood? Read the article - those are good, old-fashioned golf-club paradigms I'd say)
Spotify is a fantastic music service, no doubt; very much along the lines of what Dave Kusek and me envisioned as 'music like water' in our 2005 book 'The Future of Music', and subsequently expanded on in my follow -up book, Music 2.0 (free PDF here). Spotify is not officially available in Switzerland but I have been successfully using it via a UK paypal account (after trying simfy.de and not getting anywhere with their really awkward and crash-prone iPhone app). Unfortunately, Spotify just can't seem to get the music labels and national rights organizations to bless their launch in many other territories, including the U.S. (read this Slashgear piece for more details ). All of this - you guessed it - because the record companies and the music publishers have not agreed on the licensing and deal terms for those countries, yet, and despite the fact that Spotify is already spending most of its VC money on paying for the music licenses. The fact is that there are no compulsory licenses available for on-demand streaming and flat-rate access services so unless these deals are negotiated nobody can touch it. Read about it here, or here (my Spotify-related blog posts), or via my July 2009 blog post on specifically why I think Spotify is unlikely to survive, or peruse the Zemanta-enabled links below for more enlightenment by some smart people
So here is the point I am trying to make: I don't think a purely free-market-driven and unregulated approach will work, in the future. Many large, incumbent media companies, publishers, record labels and other traditional intermediaries (i.e. the 'industry' as opposed to the actual creators) have every reason NOT to be flexible or even slightly forthcoming with their licensing terms and thereby support the deployment of new cloud-based, access-on-demand and flat-rated services. This is simply because their very existence may quickly and irreversibly change the entire playing-field, and may make it very hard for the incumbent rights-conglomerates to continue to effectively control distribution (and by extension, advertising prices) in the same way as before. These changes aren't for the better when you currently run the entire show, so why should you agree?
This is why Warner Music Group's Edgar Bronfman has said many times that he will not license any unlimited streaming-on-demand service, why Netflix - despite of (or because?) its vast growth - has been back and forth with the Hollywood studios on getting more content deals done, and why Hulu is losing steam because of the studios' concerns over future cable-TV revenue streams. Clearly, this is all about controlling and milking the market (i.e. the 'people formerly known as consumers') as long as possible. Yes, sure, just like the big telcos used to do before they had to let competition in. This is not about 'getting the artists / creators paid' or about fighting digital piracy - it's about maintaining a comfortable and lucrative monopoly position for the longest possible time. Which is OK, too - if it wasn't for the criminalizing effect it has on every single Internet user.
Most large, international media companies (disclosure: many of which are or have been my clients in some way or the other) and almost all major TV, film and music rightsholders are used to absolute control over the distribution of the works (and artists / producers) that they own or represent, and this simple fact used to result in getting much higher license fees - the other party had no choice but to take it or leave it; no license simply meant no (legal) business. This may sound somewhat reasonable in a mostly offline world (i.e. until just recently, when the mobile Internet started to take of), but on the Net, in a truly networked society, this kind of thinking plays out quite differently: refusal to license at a price that is affordable(and / or financially viable for a new, potentially huge but legally unprecedented player) simply encourages and produces piracy, because the desired content will become available anyway, legal or not, one way or the other. The reality is that there is no real control of distribution of digital content, any longer, and all models based on re-achieving that control will fail miserably. Witness the 100s of illegal movie sites that now stream pretty much any movie on-demand, or the many new IP-cloaking and re-routing services (commonly used to access locally restricted content services) that are currently flooding the market. Not licensing content to new players on actually survivable terms simply lets other, parasitic entities prosper by offering it without permission. Everyone loses.
My thesis is that - just like telecom deregulation - we urgently need new, open and public mechanisms that first significantly encourage and then possibly even enforce the licensing of copyrighted works for new services that require a new and more experimental approach, and that may end up serving the consumers much better than the traditional services. A 'use it or lose it' rule may be useful to that end; and as far as music is concerned I have been proposing a new, public digital music license for a long time.
In any case, I think that a system that continues to be based on deriving future benefits ONLY for the largest and most powerful rightsholders (again, by that I do not mean the actual creators, but the industries that represent them) is, in my view, simply unsustainable and socially indefensible in this dawning broadband-culture and in a connected, networked and interdependent society. We need better and more transparent EcoSystems and less EgoSystems; less empires and more Open Networks.
Let me have your feedback please!
Note: if there is some kind of problem with my comment box on this blog, please use Facebook or Twitter for comments, for now, or email me and I will post them.
This is the complete, 75-minute video of my appearance on Brazil's most popular talk show on Public TV, called Roda Viva (on the TV Cultura channel). I was delighted to be invited to the show, and really enjoyed being 'grilled' by the super-smart journalists and Brazilian media experts in the studio. We could have talked forever! The show was originally broadcast on April 26 (on Brazilian TV as well as online, see the Twitter buzz here) but unfortunately the webcast did not work very well so this is the first time I have seen the video, myself, and thanks to Roda Viva / TV Cultura I am delighted to be able to share this recording with you, as well.
More information about the show is here. Duda Groisman made some great photos during the recording of this show, embedded below. Related activities on this trip include: my presentation for NBS Brazil "The Future of Communications and Business", and my presentation at Fundacao Dom Cabral (one of Brazil's best business schools) on "The Open Network Economy". Please note: the video is half Portuguese (the questions) and half English (my replies)
Everyone: this is a biggie. Check out this video below and the announcement on the Google blog. Here are some quotes from the blog, and some comments from my end:
"Google TV is a new experience for
television that combines the TV that you already know with the freedom
and power of the Internet. With Google
Chrome built in, you can access all of your favorite websites and
easily move between television and the web. This opens up your TV from a
few hundred channels to millions of channels of entertainment across TV
and the web..." My comment: this is the total web-tv convergence, at last, and this development should certainly scare the wits out of most major TV Networks. The gloves are off, guys! So far it has been quite hard to have TV-like, living-room centric experiences using the web; obviously this is just about to change. And the advertising-dollars will migrate along with our viewing (or rather, engagement -) habits! Friction will soon be Fiction, indeed. Welcome to Media as a Service (MaaS); Content in the Cloud: TeleMedia here we come.
"Because Google TV is built on open platforms like Android and Google
Chrome, these features are just a fraction of what Google TV can do. In
our announcement today at Google I/O, we challenged web developers to
start coming up with the next great web and Android apps designed
specifically for the TV experience. Developers can start optimizing their websites for
Google TV today" My comment: Google is betting on OPEN SYSTEMS to win this game, which imho is totally the right move. Yes, there is some room and argument for closed systems (Apple, PS3 etc) but almost all major successes will be fueled by open technologies, interfaces and platforms, i.e. networked and interdependent ecosystems. Going forward future, it's win-win-win-win or nothing (sound familiar?)
"We’re working together with Sony
and Logitech
to put Google TV inside of televisions, Blu-ray players and companion
boxes. These devices will go on sale this fall, and will be available at
Best
Buy stores nationwide" My comment: very smart move by Sony - they missed the boat on digital music, and on ebooks (at least to some extent, I'd say), so this is their chance to catch up.
Mashable has a good summary of the key 'what it means' points, here.
Updated again: here is a low-tech video of the Executive Roundtable presentation (just my talk, nothing else). It's kind of home-made using a Kodak ZI8 (thanks to Jeffrey Hayzlett, Kodak's amazing CMO) but still offers good value I think.
Last month, Mike Masnick invited me to do a guest-post on Techdirt.com one of my favorite online destinations. It went live last night and is getting quite a few comments - check it out here. Comments and discussion is here. Retweets are here.
If I received a dollar
every time I get a question along the lines of "how can the content
industries compete with FREE?" -- I would be traveling first class
everywhere I go. Underneath this question I often find my favorite toxic
assumption: "less control over distribution means less money."
This belief is as tired
as it is poisonous: enforcing control (when trust is really what's
needed) will yield instant disengagement, which swiftly and surely will
translate into dwindling revenues -- as the music industry keeps proving
again and again. If you believe in control rather than value and trust,
the content business of the future is not a good hunting ground for
you.
Take eBooks: despite
clear and present proof that DRM has proven disastrous in selling
digital
music (and now is pretty much history), technical protection measures
are still being looked at to 'secure distribution'. When will
they ever learn?
The thinking that the
digital distribution of content must be controlled to achieve any kind
of reasonable payment is fundamentally flawed because of this
not-so-futuristic
realization: in our open, mobile, social and digitally networked
economy,
content publishers need to offer their goods in a way that no longer
centers on the distribution of units (digital or physical) as the key
revenue factor. The idea of just selling copies is toast - selling
(i.e. offering) access is where the money is. Kevin Kelly said it years
ago: we must sell what can't
be copied, what's scarce, not what is ubiquitous.
The irrefutable trend
is that the window of opportunity of 'selling copies' (be it iTunes,
eMusic, the Kindle or the iPad) is rapidly closing. The real
opportunity,
the TeleMedia
Future, is in selling access
and presenting a constant stream of up-sells (i.e. added values and
offering
content-related experiences). Remember, as Mark McLaughlin so
righly pointed
out in the HuffingtonPost recently, consumers have never really
paid for content - they
paid for distribution! And now, distribution means Attention and Access.
Imagine when buying access
to eBooks, you wouldn't just pay for the authorized enjoyment of the
authors' words, but you would also gain instant access to highly curated
and socially-networked commentary, a fire-hose of meta-content provided
by your most important peers and friends that may also be reading these
books, and their ratings, explanations, slide-shows, images, links,
videos, cross-references -- and maybe even some direct connections with
the author or the publisher.
In an access-based, bundled
and cloud-centric content ecology, being a legitimate and authorized
user enables engagement, conversation, relevance, personalization,
meaning...
i.e. it unlocks really valuable benefits for the user. Connect
with
Fans + Reasons to Buy (as has been mentioned on this blog a few
times,
before, I believe) - that's where the money is.
In music, streaming-on-demand
will without a doubt be available 'for free' (i.e. bundled and packaged
by 3rd parties) or advertising supported, while many added values above
and beyond the mere reproduction of music will not - no matter
whether WMG's
CEO Edgar Bronfman thinks
it's a good idea 'for the industry' or not.
Just imagine where an
access-to-the-cloud model could go next: if I want a high-definition
version of my favorite opera or that Blue Note Jazz Club concert from
last night I could buy a premium package that provides it. If I want
to share my personal play-lists, ratings and comments with my Facebook
friends, and get access to their content, as well, I can add the 'social
network option' to my package. If the price is right
(micro-transactions,
anyone...?), I'll buy - because I am already hooked on the music.
The music industry needs
to ask itself this question: if a permanent, unprotected download of
a song would cost only $0.10, or if an ad-supported version of a
on-demand,
all-you-can-eat music service would be seamlessly bundled into your
mobile phone subscription - would anyone still bother to scour the web
to find badly ripped, virus-laced tracks for free? Would we need
3-Strikes
or HADOPI or Digital Economy Bills?
Yes, I know, that price
point sounds ridiculous for those record label CEOs that used to sell
CDs for 15-25 Euros a piece, but hang on a second: if they can get 95%
of the users to buy access at a much lower price (and almost
zero cost of duplication and distribution!), and in that process really
engage with them, the fans would also do the marketing for them - i.e.
share the links. Sounds like a great model to me. But of course:
selling
access at a much lower (or feels-like-free) price to quite literally everyone
only makes
sense if it actually connects directly and smoothly to a multitude of
up-selling possibilities, such as interactive versions of eBooks,
high-definition
versions of online radio shows, albums or concerts, in-depth analysis
and audio/video commentary for news, etc.
Now, content storage
is starting to move from my own computer or my hard-drives into the
cloud - and I think this is very good news for content creators,
publishers
and rights-holders because it makes it even easier to engage and up-sell
to those new
generatives. Crucially, the
answer to the constant quest of monetization is also in the cloud: I
believe most people will soon stop sharing the actual media files (since
they are getting increasingly larger and larger, and therefore more
unwieldy) and will share only the links, the bookmarks, the metadata
or the tags, and that should be a boon for the content industries.
The perfect test bed
for 'Media as a Service' (MaaS) may unfold soon, with Apple's new
iPad or Google's Tablet (hopefully). Extending the concepts mentioned
above, rather than blocking my wife or my kids from sharing an eBook
with me it would be much more logical if I could easily read her book,
as well; but beyond the 'copy of the words' all else would not be
available without a micro-transaction on my part, i.e. I would not have
instant access to the cool video clips, the updated links, the
footnotes,
the ratings, etc; i.e. all that valuable context that will make eBooks
so much more powerful would be out of my reach until I validate my own
access.
The bottom line: content
sharing isn't the real problem: high price points, outmoded, pre-web
toll-booth concepts, broken relationships and processes, low values
for high prices, bad technology and service, and utter lack of
conversation
and engagement are.
Here is my message to
publishers and content owners: lower the prices for access to your
content
to the point of unanimous excitement, use open standards and technology
platforms that work for everyone, everywhere; bundle and package as
attractively as you can (then: repeat). Team up with ISPs, mobile
operators,
advertisers and device makers.
Remove all the reasons
that your users may have to avoid your new toll-booths and skip the
desired conversion to 'paid' - the lower the hurdle for legitimate usage
and paid engagement, the higher the added values, the less you will
have to worry about 'competing with free'.
It was a great pleasure to be invited to contribute to the Sao Paulo / Brazil-based Fundacao Dom Cabral's innovative CEO leadership program, led by my colleague and Swiss-Brazilian collaborator and leadership guru Didier Marlier, as a visiting professor. Below is a fairly large and long (95 pages - do not print!!) slideshow with most of the important stuff I presented; needless to say this was not the usual 45-60 minute session but took pretty much the entire afternoon. I was extremely impressed with the organization and their hosts (FDC / Dalton Sandenberg) as well as with the fast and agile minds of the CEOs that attended - we had some very inspiring conversations. And Caipirinias, too;). Update: Low-res download of PDF here: PDF 11.5 MB Open Network Economy Gerd Leonhard FDC SP Low-res
Enjoy. Share. Retweet. And get my free iPhone app before it turns 'freemium'.
If you are interested in attending please contact me (eMail, Twitter); they have very few places left. It's a free event but reserved for senior executives in the TMT sectors.
We would like to invite you to The New Year Revolution: an insight into what's on the horizon in the technology, media and telecoms sector in 2010 (and beyond!)
We are delighted to welcome Gerd Leonhard, TMT futurist as our keynote speaker.
Gerd is renowned for his presentations and think-tank appearances, which are hard-hitting and provocative yet inspiring and motivational. His clients include Nokia, Google, Sony-BMG, Siemens, ITV, the BBC, The Financial Times and many others.
Following Gerd's keynote there will be a session bringing you up to date on important law changes for 2010.
Date: Wednesday 13 January 2010
Time: Registration, breakfast and networking at 8.30am. Seminar 9.00am to 11.00am, including time for questions. There will be more time to network when the seminar has concluded.
Venue: Berwin Leighton Paisner Adelaide House, London Bridge, London EC4R 9HA.
Nice video with some good examples of how new revenues can be generated via mobile applications; incl. Shazam, CoPilot Live, m.FT.com, AQA63336 (CEO: "in mobile, you can actually charge money")
It was a pleasure and a privilege to be invited to the Telco2.0 Executive Brainstorm event in London, today, and to address a roomful of telecom & media executives that were - as it says in the conference tagline - looking for a way to 'reduce the friction in the digital economy'. After having to listen to some rather bizarre and, sadly, rather 'retro' justifications about why those pesky Internet users and Digital Natives (i.e. our kids) really do need to be threatened with disconnection from the Net if they don't comply with the rules of yesterday's game, delivered with great pathos by the usual lobbyists from UKMusic and Universal Music Group executives (see the list of panelists below), I tried to get down to the bottom line of what the workable alternatives to their Control & Enforcement paradigms could be.
Funny thing is, that in the subsequent vote most people in the audience seemed to actually agree that disconnection and punishment are not going to change anything and are not a suitable path to new revenues... I always wonder why there seems to be strong consensus if people vote (or talk) individually, but if you hear them 'in public' everyone always delivers the good old party line of wanting more control and protection. Why is that? Whose bread we eat whose song we sing... is that it?
I will post a summary here, shortly. In the meantime, here is the slideshow (download the PDF via slideshare). A
This is just a quick update since I have received quite a few mails and tweets asking where exactly my PDF from yesterday's eComm Europe event here in Amsterdam can be found. So... here it is! I will comment more on this event and speech topics, later.
Once again, great stuff by Mary Meeker and her Internet team at Morgan Stanley, via the Web2.0 summit. The video, embedded below, is good, too, but in my opinion it's the the slides that matter most: every single page packs a punch and makes you think. Great mix of facts, statistics and some key foresights. A must-read (and then... digest). Techcrunch has some great comments on this presentation, here.
Keynote Speaker, Think-Tank Leader, Futurist, Author & Strategist, Idea Curator, some say Iconoclast | Heretic, CEO TheFuturesAgency, Visiting Prof FDC Brazil, Green Futurist
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